HassConsult today unveiled the Hass Land price indices for the second quarter of 2024, with prices in Nairobi going up by 1.8 percent as demand for land for commercial development picked up.
The growth in the quarter was higher compared to the 1.3 percent reported in the second quarter of the year, partly driven by a resurgent Upperhill where the cost of an acre grew by 3.9 percent, the fastest quarterly price jump in a decade for the area.
“The resurgence of land price in Upperhill, which posted its fastest quarterly gain since the fourth quarter of 2014 underpins the uptake of remaining current grade A office space formerly oversupplied, as well Upper Hills recent positioning for successful residential real estate,” said Ms. Sakina Hassanali, Head of Development Consulting and Research at HassConsult.
“The average land in Upper Hill hit its peak of Ksh560 million in June 2018, signaling room for valuation gains as demand for commercial and residential real estate in the area gains traction.”
In the satellite towns, the average price per acre rose by 2.2 percent, down from 3.03 percent in the first quarter as some of the price growth hotspots showed signs of cooling down. The increase in the cost of credit and that of building inputs has negatively affected real returns for developers, limiting the propensity to absorb higher land costs in areas with lower purchasing power.
Ngong and Ongata Rongai, which have had some of the fastest growing land prices over the last three years, were eclipsed by gains in Ruiru, Syokimau and Limuru in the quarter.
Ongata Rongai was the only one of Nairobi’s 14 satellite towns to report a fall in land prices in the second quarter, at negative 2.6 percent. “Land pricing in Ongata Rongai and Ngong saw a reversal of fortunes in the last quarter, a signal that the bullish pricing in the previous year is starting to level out,” added Ms. Hassanali.
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